Problem Solving and Decision
Making
A Process
Seven steps that provides
a rational and analytical
way of looking at
decisions.
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Decision Making Process
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Identify the Problem
Collect Relevant Information
Develop Alternatives
Evaluate each Alternative
Select the Best Alternative
Implement the Decision
Follow-up and Evaluate
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What is a Problem?
A discrepancy between an
existing and a desired state of
affairs.
&
Identifying the real problem is
no easy task.
3
Problem Identified
What are the surrounding
circumstances
&
Is there more than one way to
resolve the issues
???
4
Alternatives Developed
Identify the strengths and
weakness of each alternative
&
Select the one that best
addresses the salient
discrepancies
5
Make a Decision
Implement the decision and
take the steps necessary to
ensure correct timing and
execution.
Follow-up and evaluate the
results
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Decision Tools
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Expected Value Analysis
It permits decision makers to place a
monetary value on the various
consequences likely to result from
the selection of a particular course of
action.
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Decision Tools
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Decision Tree
Encompass’ expected value analysis
by assigning probabilities to each
possible outcome and calculating
payoffs for each decision path.
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Decision Tools
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Marginal Analysis
Analyzing decisions in terms of their
incremental costs.
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MIS
A mechanism to provide the manager
with needed and accurate
information on a regular and timely
basis.
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Decision Making
Styles
Everyone brings their own unique
personalities and experiences to the
decisions they make.
Notwithstanding however,
The decision-style model outlined in
your text has identified four principle
styles.
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Decision Making
Styles
The decision-style model assumes
that people differ along two
dimensions:
* Their way of thinking
(How they process information)
* Tolerance for Ambiguity
(How clear does everything have to be)
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Directive
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Low tolerance for ambiguity.
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Seeks rationality.
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Efficient and logical.
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Makes quick decisions.
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Short term focus
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Analytic
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High tolerance for ambiguity.
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Requires more information.
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Considers more alternatives.
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Careful and adaptable.
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Conceptual
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Very broad in outlook.
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Considers many alternatives.
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Good at finding creative
solutions.
Focus long range.
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Behavioral
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Work well with others.
Concerned with achievements
of subordinates.
Receptive to suggestions.
Avoids conflict.
Seeks acceptance.
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Ethics in Decision Making
Common Rationalizations
* “Its not really illegal or immoral.”
* “Its in my (Organization’s) best interest”
* “No one will find out”
* “Since it benefits the organization it will
be protected”
* “Everybody does it”
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Ethics in Decision Making
Different Views of Ethics
* Utilitarian
Decisions are made solely on the basis of
their outcomes. The greatest good for the
greatest number.
*
Rights View
Decisions emphasize respecting and
protecting the basic rights of individuals.
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Ethics in Decision Making
Different Views of Ethics
* Justice View
A view that requires individual to impose and
enforce rules fairly and impartially so there is
an equitable distribution of benefits and
costs.
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Group Decision Making
Advantages
* Provides more complete
information.
* Generates more alternatives.
* Increases acceptance of a solution.
* Increases legitimacy.
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Group Decision Making
Disadvantages
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Time consuming
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Minority domination
Pressure to conform (Groupthink)
Ambiguous responsibility
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Group Decision Making
Tends to be:
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More accurate
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More creative
More acceptable
More time consuming
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Group Decision Making
Special Techniques
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Brainstorming
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Nominal Group Technique
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Electronic Meetings
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